Mechanisms of wave transformation in finite-depth water are investigated. The linear mechanisms examined are percolation, bottom motion, shoaling, and refraction. The nonlinear mechanisms examined are wave-wave interaction and bottom friction. New exact computations of the nonliner transfer for finite-depth waves are presented for some directional wave spectra. These mechanisms are found to explain satisfactorily wave decay observations obtained at several sites with different bottom sediment properties. The decay rates at these sites are found to be dominated by different mechanisms which are determined by the bottom conditions. As an example, detailed calculations are presented for data obtained at the Jonswap site.